In maritime law, seizure remains a measure feared by shipowners. Unlike precautionary attachment, which simply detains the vessel, execution leads to its forced sale. A complex and rigid process, it pits determined creditors against shipowners in financial difficulty.
I. Concept of the seizure and execution of ships
Definition and objectives
Seizure and execution allows creditors to sell their debtor's vessel at public auction. The aim is to recover an unpaid debt by realising the asset. The vessel becomes the instrument of payment.
This procedure is governed by the French Transport Code (articles L. 5114-23 et seq.) and the French Code of Civil Enforcement Procedures.
Place in maritime enforcement proceedings
Attachment is one of the means of forced execution in maritime matters. Professor Rodière described it as "an extreme measure, as rare as protective attachment is commonplace".
It differs from other mechanisms such as customs seizures or criminal confiscation, which are based on a repressive rather than a recovery approach.
Comparison with protective attachment
There are many differences between these two procedures.
Attachment:
- Requires a claim that "appears to be well-founded in principle".
- No writ of execution required
- Temporarily immobilises the vessel
- Pressure tactics
Seizure and execution :
- Enforceable title required
- Forced sale of the vessel
- Often comes into play after a seizure has failed
- Represents the creditor's last resort
It should be noted that, in practice, protective attachment is often sufficient to force the debtor to pay, given the considerable economic impact of immobilising a vessel.
II. Requirements
Need for a writ of execution
The creditor must have an enforceable title. Article R. 5114-22 of the Transport Code is unequivocal on this point.
This title can be:
- A judgment that has become res judicata
- An enforceable notarial deed
- An exequaturated arbitration award
- A foreign judgment recognised as enforceable in France
The use of a provisional injunction as the basis for an execution order has long been debated. Some courts now accept this possibility, but not without risks for the creditor.
Characteristics of the claim
The claim must be:
- Liquid (amount determined)
- Due (its term has expired)
- Certain (its existence is not in dispute)
An enforceable title normally ensures these characteristics.
Please note: collective proceedings opened abroad can only be enforced against creditors from the date of the exequatur judgment, as the Montpellier Court of Appeal pointed out in the "Biladi" case.
Conditions relating to the vessel
The seized vessel must belong to the debtor. This rule, simple on the face of it, is complicated by the legal arrangements common in maritime law.
Single ship companies are problematic. The creditor may believe that the operator of the vessel is the owner, whereas ownership and operation are often separate entities.
Case law generally rejects seizures of vessels that do not belong to the debtor, unlike protective seizures, which are more flexible.
A notable exception is that creditors with a right of resale (mortgagees in particular) may pursue the compulsory sale of the vessel even after it has been transferred to a third party.
III. Attachment procedure
Advance payment order
The procedure begins with a summons to pay served :
- To the owner or his representative
- To the ship's captain
- To the ship's agent
This command must contain :
- Reference to the enforcement order
- Statement of amounts due (principal, costs, interest)
- A warning that if payment is not received within 24 hours, the forced sale may be pursued
- The precise time of service
- The creditor's choice of domicile
Failure to comply with these formalities may invalidate the procedure.
Time between order and seizure
A period of 24 hours must elapse between notification of the summons and the drawing up of the seizure report.
This brief but imperative deadline is designed to give the debtor a last chance to perform. If it is breached, the seizure is null and void.
The summons will lapse after 10 days. A new service will be required after this period.
Seizure report
After visiting the vessel, the bailiff will draw up a report. This document must mention:
- Details of the pursuing creditor
- The writ of execution on which the seizure is based
- The amount of the claim
- The date of the order
- The court in which the sale will be conducted
- The characteristics of the vessel (name, type, tonnage, flag)
- Detailed inventory (boats, canoes, tackle, equipment)
If the essential information is missing, the minutes may be invalid.
Role of the bailiff and appointment of the guardian
The bailiff plays a central role. He must personally carry out the seizure; a clerk, even a sworn one, cannot replace him.
It appoints a custodian, often the captain himself. The Conseil d'État has ruled that the autonomous port cannot perform this function.
The custodian must sign the act of seizure. His role is crucial in preventing any damage to the vessel during the arrest.
IV. Advertising and registration
Notification to port authorities
The minutes are served:
- To the services of the port where the vessel is based
- To the consul of the country to which the ship belongs (if flying a foreign flag)
The purpose of this notification is to materially prevent the ship's departure. In practice, the port authorities are often alerted as soon as the command is given, to prevent any leakage.
Entry in the special register
The writ of seizure must be registered :
- In the register kept by the maritime mortgage registrar
- On the ship's registration card (if franked)
- On a special file (if not in French)
This entry must be made within 7 days of the official statement of offence (this period may be extended to 27 days in certain cases).
As of 1 January 2022, the clerks of the commercial courts, rather than the customs authorities, will be responsible for such advertising.
Notice to registered creditors
The registrar will issue a statement of entries within 10 days of the transcription of the minutes.
The registered creditors (in particular mortgagees) are notified of the seizure within the following 7 days, at the address they gave at the time of registration.
This notice contains a summons to appear before the judge.
Deadlines
Failure to comply with the publication and registration deadlines may render the seizure unenforceable against third parties, seriously compromising its effectiveness.
A well-informed owner could sell his vessel or establish rights over it, to the detriment of the negligent distrainor.
V. Forced sale of the vessel
Organisation by the enforcement judge
The enforcement judge organises the sale after verifying that the property has been sold:
- The existence of an enforcement order
- The legality of the seizure procedure
- Compliance with advertising formalities
His judgement organising the sale is subject to appeal.
Determining the terms of sale and price
The judge sets :
- The price
- Conditions of sale
- The specifications (generally prepared by the seizing party's lawyer)
The auctioneer may postpone the auction date if market conditions are not conducive to obtaining a good price.
Advertising the sale
The terms and conditions of sale are published:
- By extract in a legal gazette
- Posters on the ship, in court, in the port
- Chamber of Commerce, Customs Office
These notices contain specific information: the person suing, the writ of execution, the description of the vessel, the price to be paid, etc.
A period of 15 days must elapse between this advertising and the sale.
Auction procedure
The auctions take place :
- At the hearing of the enforcement judge
- Before another designated court
- At a notary's or broker's office
- Any other place in the port
They must be submitted by a lawyer registered with the relevant bar.
The judge will record the sale in a judgment that puts an end to the proceedings.
Possible incidents
A number of incidents can occur:
- No bid: the judge sets a new date with a lower price
- Non-payment by the successful bidder: the sale is cancelled and a re-bidding procedure is initiated.
- Application for diversion by a third party claiming to be the owner
These incidents considerably lengthen the procedure.
VI. Consequences and follow-up of the sale
Transfer of ownership
The auction transfers ownership of the vessel to the successful bidder. This transfer is immediate, but the successful bidder must pay the price within 24 hours.
The copy of the auction judgement constitutes the title deed.
The distrainee debtor is served with the judgment and given formal notice to deliver the vessel.
Purge of liens and mortgages
The auction purges all liens and mortgages on the vessel.
At the request of the successful bidder, the court will record this purge and order the corresponding entries to be deleted.
No new registration is possible on the part of the distrainee debtor, even if the creditor has a title that predates the distraint.
Prize distribution
The distribution of the price differs according to the number of creditors:
- Single creditor: the prize is simply handed over to the creditor
- Multiple creditors: a complex procedure begins
The enforcement judge first attempts to reach an amicable settlement. If this fails, he will draw up a draft distribution plan, which will be notified to the creditors, who may contest it within 15 days.
Crew situation
The auction legitimises the dismissal of the captain. The captain may be awarded damages if the new owner does not keep him in his post.
Other crew members are not affected by this special provision.
In the case of charter contracts, it is customary to complete at least the current voyage, but this practice is not compulsory.
Unpaid wages benefit from a first-rank lien, offering seafarers relative protection.
Sources
- Transport Code, articles L. 5114-23 to L. 5114-29 and R. 5114-20 to R. 5114-46
- Case law: Cass. com. 13 January 1998, no. 95-15.497; Cass. com. 17 December 2003, no. 02-14.840; CA Montpellier, 3 April 2014, no. 13/05373
- Decree no. 2016-1893 of 28 December 2016 on the provisions of Book I of the Transport Code
- Rodière R., Traité général de droit maritime, Le navire, Introduction et armement, Dalloz, 1980
- Maslin J.-P., De Franssu A., "Navire et autres bâtiments de mer - Vente forcée des navires - Saisie-exécution", JurisClasseur Transport, Fascicule 1135, 2017
- Payan G., "Saisie des bateaux, navires et aéronefs", Répertoire de procédure civile Dalloz, 2016
- Brussels Convention of 10 May 1952 for the Unification of Certain Rules Relating to the Precautionary Arrest of Seagoing Ships
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